Today’s acquisition announcement by Verizon Wireless reached out and touched the telecommunication exchange traded funds (ETFs).

Verizon Wireless announced that it will acquire the regional wireless carrier, Alltel, in a deal worth $28 billion, report Sharma, Berman and NG of the Wall Street Journal. This deal will create the largest U.S. cellphone company with more than 80 million customers. Rival, AT&T(T) has 71 million customers.

Verizon Wireless is a joint venture of Vodafone Group (VOD) and Verizon Communications (VZ). Last year Alltel was sold in a leveraged buyout and the lenders have had a difficult time selling the debt to other investors. Verizon Wireless’ deal will certainly help the lenders out in the current credit crunch.

At a time when the cellphone market in the U.S. is saturated, companies are finding that growth can be found in acquisitions or in selling new services, such as web access for phones.

Some of the telecommunication ETFs include:

• iShares Dow Jones U.S. Telecom (IYZ), down 9.3% year-to-date; 20.9% weight of AT&T and 13.7% of Verizon
• Vanguard Telecom Services (VOX), down 9.6% year-to-date; holds 20.8% AT&T and 19.9% of Verizon
• iShares S&P Global Telecom (IXP), down 10.2% year-to-date; holds 16.7% AT&T, 11.8% Vodafone and 7.7% Verizon

Tags | Telecommunications